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November 7, 2007

The Ever Green Fund

Kevin E. Dayhoff

Last Friday, the House Environmental Matters Committee in the Maryland General Assembly held a hearing on House Bill 23, the “Maryland Green Fund.”

Simply stated, it would establish an annual tax on the amount of square footage of impervious surface on each and every property in the state with the revenue to be used to help improve the health of the Chesapeake Bay.

Although the concept of taxing impervious surface has been around since the 1990s, memory serves that this legislation was first introduced three years ago and re-introduced recently in the January 2007 session in the form of House Bill 1220, and cross-filed as Senate Bill 901.

That incantation of the legislation would have developed a fund with a revenue source from only new development – and not existing improved real estate. It was estimated at the time, that – if passed – this bill would have levied a fee as high as $1,500 for a new home. The effort in the last session passed the House, but failed in the Senate.

Another idea previously floated was to raise the reviled Vehicle Emissions Inspection Program fee from $14 to $45. Yeah, right. Moving on…

In last Friday’s hearing, the Capital News Service reported that “(f)armers, sportsmen, environmentalists – even some development groups – testified … in support of” the bill.

But in an understatement that should have brought a smile to those who follow the General Assembly and environmental initiatives – and especially those who study the increasingly curmudgeon behavior of Senate President Thomas V. “Mike” Miller (D., PG-Calvert), the article stated that “the bill comes at a bad time.”

Duh – you think?

The Washington Times wrote that “several senators say there's little appetite for another new tax as lawmakers are already considering more than $1 billion in new taxes in (the) special session…”

Whispers in the hallways were that Gov. Martin O’Malley was also less than pleased. Many critics of the “Green Fund” consider it to be a regressive tax in an era when the governor is using a special rhetoric-lure as he trolls for a more “progressive” tax structure in which he claims 83 percent of Marylanders will remain unaffected.

Many wondered what the chair of the House Environmental Matters Committee, Del. Maggie McIntosh (D., Baltimore), was thinking when she re-launched the deep-sea fishing ship “Green Fund” on the storm waves of the governor’s aggressive and controversial special tax initiative.

Moreover, coming on the heals of the bruising reaction by rural voters to the Bay Restoration Fund initiative from several years ago, dubbed the “Flush Tax” by its detractors, there is little appetite on the part of rural legislators for the “Green Fund” tax at this point.

It was one thing to explain the merits of Marylanders pooling financial resources to help smaller municipalities retrofit existing sewage treatment plants with expensive upgrades that were beyond their tax base to fund. But the wheels fell off the Bay Restoration Fee-hay wagon when urban legislators poked then-Gov. Robert L. Ehrlich, Jr., in the eye by insisting on extending the fee to rural septic tank owners.

For the smell of it, it was brilliant. It was only last Monday that a letter writer in The Cumberland Times-News opined: “Western Maryland will be sorry they voted Gov. Ehrlich out of office over the small $35 Chesapeake Bay tax before the next four years are over.”

However, many environmentalists, who live in the real world and understand politics, believe that by extending the Flush Tax to septic owners, supporters of the “Green Fund” may have cut their noses off to spite their face as rural Maryland is in no mood for a fee which may cost every homeowner in Maryland approximately $20 per year. Or local churches as much as $100 per year. The Maryland Chamber of Commerce has complained that the “Green Fund” would “cost Maryland businesses about $41 million annually.”

Estimates vary according to several published accounts, but the proposed “Green Fund” is expected to raise anywhere from $53.3 million to over a $100 million a year. Forty percent would be dedicated to the Maryland Department of Agriculture for anti-pollution measures for farmers. Ten percent would go to the Department of Natural Resources.

One reason that the Maryland Association of Counties and the Maryland Municipal League strongly supports the measure is that 45 percent would to local government for much needed funding for storm water management.

Meanwhile, to further complicate matters, many in rural Maryland are of the understanding that the Chesapeake Bay Foundation is behind the “Green Fund.” Despite a noble effort on the part of the foundation to mend fences with Maryland agriculture, hard feelings remain in areas of Western Maryland and the Eastern Shore where the Chesapeake Bay Foundation is often muttered under a farmer’s breath in the same breath with PETA.

That said, many who took the Chesapeake Bay Foundation for their word – that they were going to tone down the rhetoric against Maryland agriculture – have noticed a profound change in their approach.

In many conversations with the Chesapeake Bay Foundation, Maryland agriculture pleaded that profit margins in farming simply do not facilitate funding many of the pollution mitigations suggested for the health of the Bay. To the foundation’s credit, the “Green Fund” would do just that – pay for riparian buffers and other nutrient run-off abatement measures being asked of farmers.

Of course, one olive branch, which would go a long ways to mending the fence, would be to exempt agriculture from the proposed “Green Fund” tax.

Delegate McIntosh’s counterpart, Sen. Joan Carter Conway (D., Baltimore), chairman of the Senate Education, Health, and Environment Committee, was credited by several publications as saying the green fund is “conceptually a good bill. We will address the issue in January ’08.”

Until then, let’s call it the “Evergreen Money Tree Fund” because it is coming back next spring. The goal is worthy; the devil is in the details.

(Editor’s Note: After Mr. Dayhoff submitted his column, it was learned that Delegate McIntosh has reintroduced her “Green Fund” bill – with appropriate changes made to address legislators’ concerns. It now stands a good chance of passing in this special session as several farming organizations are in full support.)

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